Deep Producer 1: Was there ever a plan to stay afloat?

November 24, 2020

Dateline 2020-11-02, FMT:

With the Deep Producer 1 languishing in Dubai pending a court auction for US$6.2 million in wharfage and related charges, questions are being asked as to the viability of its acquisition.

In March 2011, Ramunia Holdings Berhad (now TH Heavy Engineering Berhad or THHE), entered into a preliminary agreement to secure marketing rights to the vessel to allow it to bid for FPSO projects.

Ramunia went on to acquire the vessel for US$82.5 million, a 36.5% discount on its market value, substantially financed by bank borrowings.

The discount aside, Ramunia’s other justification for the acquisition was less clear. At the time, the company’s own disclosure sheet merely referred to “the prospects of time charter arrangement for any FPSO projects being secured”, but without specific details.